About 6 years ago I started to notice that certain friends of
mine had quit their jobs but continued to live very luxurious
lifestyles - seemingly without doing very much. I thought they
must just be using up their savings until I discovered they were
all making a fantastic living by spending just a few hours a week
doing something I had never heard of before - 'financial spread
betting'.
More and more people are now becoming familiar with the phrase
'financial spread betting'. Once, the sole preserve of City Whiz
kids or sophisticated gamblers, financial spread betting is now
gaining in popularity as a great way to earn a very sizeable
tax-free income without the risk of losing the shirt off your
back!
So why is financial spread betting becoming so popular?
Well, with a bit of understanding and practice, ordinary people,
with no prior experience, can earn enormous sums whilst
controlling their risks and limiting their losses. You do not
even need a stockbroker or a city dealing account to do get
involved. An on-line account is very simple to open and anyone
with web access can do it.
Spread betting, aka futures trading, is easy to understand if you
stick to a simple index like the FTSE 100 or the DOW JONES.
In basic terms, this is how it works:
When you buy a ‘future’ you take a position on what you think
the index (e.g. the FTSE 100, or the DOW ) will be at some future
date - e.g. June 2005. Let’s say the FTSE is currently at 5200
and you think it will rise over the next three months as
'terrorist fever' abates. You would buy the June FTSE at (say)
$10 per point. For every point it rises, you make $10. If it goes
up 100 points, you make $1000. Of course, if you get it wrong and
the index falls by fifty points (say), you lose $500.00.
You must be very aware of the risks before you get involved. As
with any investment or business, you can lose money. If, by
nature, you are a timid, cautious person, then it is definitely
not for you. But if you have some money to play with, and aren’t
risk adverse, then financial spread betting is the one of the
best possible ways you can make a great deal of money completely
tax free… and there are clever ways of limiting your losses so
you never lose more than you can afford.
Unlike most businesses, it is possible to get involved with an
absolute minimal outlay and take a position without buying a
single thing. You do have to ‘back’ your position with a certain
amount of cash, but this is ‘insurance’ money, NOT stake money.
The best thing is you can try it for free without any risk at
all. You can ‘dry trade’ with ‘monopoly’ money until you get a
feel for how it works and are confident enough to start using
real money.
Financial spread betting has become so popular primarily because
of the relationship between risk and capital. It is highly
leveraged and you can make huge profits with only a limited
amount of capital and risk. The fact that there is (unlike with
most investments) no stamp duty or tax also helps make it
extremely attractive.
So if you are of the right temperament, spread betting can be a
very lucrative way of making an amazing income in your spare
time. But be warned, if used recklessly or without the correct
knowledge it can result in large losses.
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